Why does lean accounting work in a lean manufacturing environment?
A)Standard costing variances encourage overproduction.
B)Distorted product costs may conceal the outcome of success of a lean system.
C)Traditional operational controls work against demand-pull systems.
D)Single-value stream allows for direct tracing of costs to product

Question

Quizplus · Accepted Answer

In lean manufacturing, the focus is on creating value for the customer while minimizing waste. Lean accounting supports this by providing a more accurate and transparent view of costs, which allows for better decision-making. By having a single-value stream, it becomes easier to trace costs directly to products or activities, which can help identify areas for improvement and eliminate waste. Traditional costing methods, such as standard costing, may encourage overproduction and hide inefficiencies in the system. Therefore, lean accounting with its focus on direct-tracing of costs is the best choice in a lean manufacturing environment.

Why Does Lean Accounting Work in a Lean Manufacturing Environment